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  2. How Trump-Era Tariffs Disrupted the Global Packaging Industry !

How Trump-Era Tariffs Disrupted the Global Packaging Industry !

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By Aditya Panwar on Mon, 04/14/2025 - 12:29
Tariff Effect

The Trump administration’s sweeping tariffs—imposed on countries across the globe under the guise of national security and trade imbalance correction—left a lasting impact on multiple industries. One of the most overlooked yet deeply affected sectors was packaging manufacturing. From raw material sourcing to finished product distribution, the ripple effects were far-reaching.

1. Raw Material Costs Skyrocketed

The tariffs targeted a range of imports, including aluminum and steel—two vital materials used in rigid packaging, cans, closures, and specialty films. With these tariffs in place:

  • Domestic prices for metals surged due to reduced foreign competition.

  • Packaging manufacturers relying on imported raw materials faced higher input costs, directly affecting profitability.

  • Flexible packaging, which relies on multilayer structures including PET, PE, and aluminum foils, also saw inflated costs.

2. Supply Chain Disruptions and Re-routing

Tariffs on countries like China, Canada, Mexico, and the EU triggered supply chain reconfigurations. Many packaging players had to:

  • Shift suppliers to tariff-exempt regions, often at the cost of quality or reliability.

  • Face longer lead times, logistics issues, and increased working capital requirements.

  • Cope with bottlenecks in key inputs like resins, films, and pigments.

3. Demand Volatility & Usage Trends Shifted

Rising costs forced FMCG brands to rethink packaging design and opt for minimalistic or downgauged options. Some key outcomes:

  • Lightweighting and mono-material structures gained momentum to cut costs and support recyclability.

  • Increased pressure on packaging converters to innovate while staying cost-competitive.

  • Packaging usage patterns shifted towards regional sourcing to minimize cost variability.

4. Global Trade Became Less Predictable

The unpredictability of trade policy created uncertainty in long-term planning. Multinational companies hesitated on capital investments in packaging infrastructure, opting instead for short-term strategies to remain agile.

  • Export-oriented manufacturers in Asia, especially China and India, saw declining orders from U.S. clients.

  • U.S.-based packaging players struggled with competitive pricing against foreign rivals facing retaliatory tariffs.

In packaging, trade policy isn’t just macroeconomics—it’s material science, design, and delivery.

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